Section 939A of the Dodd-Frank Wall Street Reform and Consumer
Protection Act (Dodd-Frank Act) contains two directives to Federal
agencies including the OCC. First, section 939A directs all Federal
agencies to review, no later than one year after enactment, any
regulation that requires the use of an assessment of creditworthiness
of a security or money market instrument and any references to, or
requirements in, such regulations regarding credit ratings. Second, the
agencies are required to remove any references to, or requirements of
reliance on, credit ratings and substitute such standard of
creditworthiness as each agency determines is appropriate. The statute
further provides that the agencies shall seek to establish, to the
extent feasible, uniform standards of creditworthiness, taking into
account the entities the agencies regulate and the purposes for which
those entities would rely on such standards.
On November 29, 2011, the OCC issued a notice of proposed
rulemaking (NPRM), seeking comment on a proposal to revise its
regulations pertaining to investment securities, securities offerings,
and foreign bank capital equivalency deposits to replace references to
credit ratings with alternative standards of creditworthiness.
The OCC also proposed to amend its regulations pertaining to
financial subsidiaries of national banks to better reflect the language
of the underlying statute, as amended by section 939(d) of the Dodd-
Frank Act.
Today, the OCC is finalizing those rules as proposed.
Alternatives to the Use of External Credit Ratings in OCC Regulations
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